Introduction

What's new in EVO 2022?

Mobility is at the core of modern civilization, and the way people and goods move impacts many aspects of life. The years ahead will bring significant changes as electrification, shared mobility and, eventually, autonomous vehicles reshape automotive and freight markets around the world.

This report is an executive summary of BloombergNEF’s seventh annual Long-Term Electric Vehicle Outlook (EVO). There are now almost 20 million passenger EVs on the road and electrification has spread to other segments of road transport. There are over 1.3 million commercial EVs, including buses, delivery vans and trucks, and there are over 280 million electric mopeds, scooters, motorcycles and three-wheelers on the road globally. Battery technology continues to improve, policy pressure toward ‘net zero’ is rising in many countries, and automakers are ramping up manufacturing of compelling new EV models.

Despite the rapid rise in EV adoption, road transport is still not on track for carbon neutrality by 2050. Simply changing out the drivetrain of vehicles may not be the most efficient way to deliver net zero, and a full range of solutions – including more public transit, and active transport options – will be needed. Aggressive action from policy makers will be required, especially on heavier vehicles, where both batteries and hydrogen fuel cells are vying for a place in the market. The window to stay on track for net zero is closing quickly.

There is also a widening gap between wealthy and emerging economies on EV adoption. There is a growing risk that the transition is not an equitable one, and that many economies miss out on the benefits of better air quality and new investment. Raw materials supply constraints for batteries also look very tight for the years ahead. This is set to push back the point of EV price parity in some segments but will not derail the global EV market.

This report draws on BloombergNEF’s team of sectoral and regional experts around the world. It updates our outlook for how road transport could evolve over the next 30 years. It includes analysis on EV adoption in passenger vehicles, commercial vans and trucks, two- and three-wheeled vehicles and buses globally. It also looks at other drivetrains, including hybrids and fuel cells, and then explores the resulting impacts of all of these on electricity markets, oil demand, battery materials, charging infrastructure, and CO2 emissions. This year’s outlook includes analysis in several new areas, including the potential role of vehicle-to-grid technology.

"There are now almost 20 million passenger EVs on the road, 1.3 million commercial EVs, including buses, delivery vans and trucks, and over 280 million electric mopeds, scooters, motorcycles and three-wheelers."

Electric Vehicle Outlook 2022, BloombergNEF

What’s new in EVO 2022?The important new areas of analysis in this year’s EVO are the following:

Net Zero Scenario. Based on an economic analysis of competing technologies in each segment, we have developed a scenario for what a vehicle fleet capable of zero CO2 emissions could look like. Despite the rapid growth of EV sales, only a few countries are currently on track to reach net zero by 2050 and most will need additional policy interventions in the years ahead. This is especially true in emerging economies. The focus of the Net Zero Scenario is on tailpipe emissions, and it does not explicitly bring upstream emissions from electricity generation, hydrogen production or vehicle manufacturing to zero. This year’s Net Zero Scenario includes country-level analysis for the main passenger vehicle markets.

New thematic highlights. This year’s outlook includes includes five Thematic Highlights on important emerging topic areas:
– The EV adoption gap between wealthy and emerging economies
– Heavy duty long-haul trucking: batteries versus hydrogen fuel cells
– The value of vehicle-to-grid: A U.K. case study
– The supply and demand dynamics for battery metals from now to 2030
– Reshaping mobility demand through modal shifts

Updated lithium-ion battery price, volume and chemistry forecast based on our most recent market survey: We have developed a new battery chemistry forecast for the passenger vehicle market that reflects rising deployment of lithium-iron phosphate (LFP) batteries and other advancements in new cathode chemistries. We have also adapted our battery pack size projections for China to reflect the success of very small EVs there.

Updated expected energy consumption from EVs to reflect real-world vehicle efficiencies. This includes losses from charger inefficiencies, cold weather driving, and battery degradation over time.

Updated metals outlook. We have updated our near-term supply and demand balance for the critical metals and materials needed to scale up EV production, many of which are at record high prices. This includes lithium, cobalt and nickel.

New breakout section on three-wheeled vehicles. This was previously combined with two-wheeled vehicles. This segment is electrifying faster than any other and is mostly on track to achieve our Net Zero scenario.

Finally, we have re-run our vehicle economics and Bass-diffusion models using the most recent EV sales data and vehicle pricing for all segments. The EV market is still in the early stages so each additional year of data helps calibrate results. Our passenger EV results are slightly higher than last year’s outlook, due mostly to faster adoption in China and Europe. The outlook is also higher for electric trucks, while buses and two-wheeler results are in a similar range to last year.